You are the manager and owner of E-bulbs Inc.and you know that your factory experiences economies of scale.You want to quantify the extent of scale economies in the production of E-bulbs Inc.so you need to find:

Question

Quizplus · Accepted Answer

To quantify the extent of scale economies, one needs to find the minimum efficient scale, which is the level of output at which the average cost of production is minimized. Diseconomies of scale refer to a situation where production costs increase as output increases, which is not what we are looking for. Diminishing marginal productivity and returns refer to the decrease in output resulting from adding more inputs, but they do not help us in finding the minimum efficient scale.

You Are the Manager and Owner of E-Bulbs Inc